100% Hard Money Financing
I know, all over the Internet it says you can get 100% hard money loans for your deals. And you can, IF you have a true private lender or friend financing you. You may even find a reputable person to partner on a deal with you, and bring in funds.
Beware of websites promising 100% Hard Money Loans. Most of them exist to take your “membership fee” or other large upfront fees totaling thousands of dollars. DON’T do it.
They make most their money from charging up front fees, NOT lending money. Although a few of them may actually do a loan for a slam dunk killer deal, if they do, they’ll end with most of the potential profit too.
Real Hard Money Financing
In my world, we require you to have some money invested in the deal. In short, if you’re not willing to put your money in the deal, why should I?
For budgeting purposes, plan on 20% of the purchase and rehab funds from your own money, plus closing costs. Most loans we do end up at 15% from you, but you should plan appropriately. On the low side, you may need as little as 10% of the purchase price, and get all the rehab funded for you. It really depends on the specifics of the deal, and your experience.
Upfront fees? Not normally. Every now and then for an unusual deal, there will be an upfront fee. Even where there is, you only pay it AFTER we approve you AND we approve your deal. We don’t have a fee to join some “special club” to get access to overpriced financing.
When we ask for one it’s to cover some of our up front expenses and to weed out people who aren’t really serious. If for some reason, we can’t do your deal after we’ve approved it we will refund it to you. (Assuming you provided good information.)